The $9 minimum wage proposed in the SOTU is less than the $9.50 that Obama proposed during his first campaign. For a full-time worker, that's about $1,000 less per year. And, as Tim Noah has noted, if adjusted for inflation, that proposed minimum would be around $10 (or $2,000 less) today.

In response to questions about the difference, the White House makes this argument: "Obama was able to secure refundable tax credits that are worth 75 cents an hour for someone with two children who works full-time, [NEC Deputy Director Jason] Furman said, 'so if you think of that extra money together with the extra money from this minimum wage increase, the two of those together would first of all exceed the minimum wage number he called for on the campaign.'"

Hmm, no.

The problem here is that in his 2008 campaign, President Obama proposed not only a $9.50 minimum, but also a more extensive set of refundable tax credits than the ones now in place. The tax credits the President proposed in 2008 that have not been adopted include:

a refundable Making Work Pay Tax Credit, which as originally proposed would have equaled 6.2 percent of earnings up to $500 per worker (a $400 per worker MWP was in place for 2009-2010);

making the Child and Dependent Care Tax Credit refundable and equal to 50 percent of child care expenses less than $6,000;

a refundable "Universal Mortgage Credit" equal to 10 percent of mortgage interest for nonitemizers up to $800;

more than doubling the currently very small EITC for childless workers (under the maximum credit for childless workers would have increased from $452 in 2009 to $1,110 in 2012);

making the Saver's Credit refundable and changing it to a 50 percent match of the first $1,000 in savings; and

a refundable American Opportunity Tax Credit equal to 100% of the first $4,000 of college expenses (as extended in the fiscal cliff deal, this credit is capped at $2,500).

According to the White House, the President’s proposal to increase the minimum wage to $9 an hour by the end of 2015 will ensure that “no one who works fulltime should have to raise their family in poverty.”

But is a $9 minimum wage sufficient to meet this goal? Not necessarily, even if we use the antiquated official poverty threshold, and especially not if we use a modern threshold that comes a little bit closer to what families need to make ends meet at a basic level in today's economy.

First, let’s look at where $9 an hour gets a family of four using the antiquated official threshold. Using the same assumptions as the White House, a family of four supported by a full-time worker earning $9 an hour would have gross earnings of $18,018 in 2015. This would put them about $6,600 below the projected 2015 poverty line of $24,635. (To get the projected poverty line, I adjust the Census official poverty threshold using CBO’s most recent inflation projections.)

If we subtract payroll taxes and add in the Earned Income Tax Credit and Child Tax Credit, their net income would come to $24,501—99 percent of the official poverty line (here, again, I adjust the value of the EITC and CTC, which are indexed to inflation, using CBO’s projection). This calculation is favorable to the Administration because it assumes that the $9 minimum will be in place for all of 2015 (the White House fact sheet says only that it will be in place by “end of 2015”).

In his State of the Union address, President Obama reminded us that "there are millions of Americans whose hard work and dedication have not yet been rewarded… for more than a decade, wages and incomes have barely budged… We know our economy is stronger when we reward an honest day’s work with honest wages." The table below provides a perspective on this trend. It shows the increase between 2007 and 2011 in the number of workers (ages 25-64) below the federal poverty line, and breaks the numbers down by educational attainment.

As the table shows, there were nearly 1.4 million more workers with below-poverty incomes in 2011 than in 2007, and the worker poverty rate increased from 4.9% to 6.2%. Pundits typically frame poverty as being due to low educational attainment (when they're not ascribing it to bad parenting practices), but the table shows how narrow-minded this is. Yes, poverty rates are higher among workers without a high school diploma, but the vast majority of workers below the poverty line (72% in 2011) have a high school diploma or higher, and more than one in three today have a BA degree or some college. As I've noted previously, Americans living below the poverty line today are better educated than e ver, a trend that appears to have continued over the last several years.

One caveat here is that the federal poverty line (a laughable $18,500 for family of three) hasn't been updated for changes in mainstream living standards since the Beatles' first American tour. As a result, the table substantially undercounts the number/percentage of American workers who don't have sufficient incomes to make ends meet.

In his State of the Union address to Congress President Obama called for a higher minimum wage. The purchasing power of the minimum wage peaked in the late 1960s at $9.22 an hour in 2012 dollars. That is almost two dollars above the current level of $7.25 an hour. Most of the efforts to raise the minimum wage focus on restoring its purchasing power to its late 1960s level, setting a target of around $10 an hour for 2015 or 2016, when inflation will have brought this sum closer to its previous peak in 2012 dollars.

While this increase would lead to a large improvement in living standards for millions of workers who are currently paid at or near the minimum wage, it is worth asking a slightly different question. Suppose the minimum wage had kept in step with productivity growth over the last 44 years. In other words, rather than just keeping purchasing power constant at the 1969 level, suppose that our lowest paid workers shared evenly in the economic growth over the intervening years.

This should not seem like a far-fetched idea. In the years from 1947 to 1969 the minimum wage actually did keep pace with productivity growth. (This is probably also true for the decade from when the federal minimum wage was first established in 1937 to 1947, but we don’t have good data on productivity for this period.)

As the graph below shows, the minimum wage generally was increased in step with productivity over these years. This led to 170 percent increase in the real value of the minimum wage over the years from 1948 to 1968. If this pattern of wage increases for those at the bottom was supposed to stifle growth, the economy didn’t get the message. Growth averaged 4.0 percent annually from 1947 to 1969 and the unemployment rate for the year 1969 averaged less than 4.0 percent.

This link between productivity and the minimum wage ended with the 1970s. During that decade the minimum wage roughly kept pace with inflation, meaning that its purchasing power changed little over the course of the decade. The real value of the minimum then fell sharply in the 1980s as we went most of the decade without any increase in the nominal value of the wage, allowing it to be eroded by inflation. Since the early 1990s the real value of the minimum wage has roughly stayed constant, which means that it has further fallen behind productivity growth.

How was it decided to break the link between productivity growth and the minimum wage? It is not as though we had a major national debate and it was decided that low-wage workers did not deserve to share in the benefits of economic growth. This was a major policy shift that was put in place with little, if any, public debate.

If the minimum wage had kept pace with productivity growth it would be $16.54 in 2012 dollars. It is important to note that this is a very conservative measure of productivity growth. Rather than taking the conventional data published by the Bureau of Labor Statistics for the non-farm business sector, it uses the broader measure for economy-wide productivity.[1] This lowers average growth by 0.2-0.3 percentage points.

This measure also includes an adjustment for net rather than gross output. It also uses a CPI deflator rather than a GDP deflator, which further lowers the measure of productivity growth.[2] Even with making these adjustments the $16.54 minimum wage would exceed the hourly wage of more than 40 percent of men and more than 50 percent of women . We would have a very different society if all workers were earning a wage above this productivity linked minimum wage.

[2] These adjustments are explained in Baker, 2007. For the years since 2006 we assumed that the difference in the growth rate of non-farm productivity and the growth of this adjusted measure is the same as it was on average for the years 2000-2006.

I am greatly pleased to see such interest in CEPR’s recent report on work hours and climate change. All evidence points to the idea that gradually reducing annual labor hours per worker will reduce the amount of climate change with which the world will have to cope. But this does not mean that ordinary workers will have to make a sacrifice. Rather, this is about how workers may choose to enjoy the fruits of increased productivity—if only they are given the chance to share fully in economic progress.

Throughout the 1950s, workers in the United States enjoyed fewer hours of labor than almost every country in Western Europe. On average, an employed American worked 1,909 hours in 1950. Only Sweden—at 1,871 hours—worked less. By contrast, Greeks averaged 2,712 hours that year; the Irish put in 2,753.

Today, workers in Greece are second only to Poland for the longest working hours in all Europe and labored 330 hours longer in 2012 than their American counterparts. However, productivities of these countries have climbed dramatically since 1950 as hours have fallen. In each hour of work in 2012, each American produced 3.2 times as much as in 1950. This allowed workers to build 2.9 times as much in each year— and do so in 200 fewer hours than in 1950. In this way, American workers labored a bit less and still prospered materially.

These same Americans might have enjoyed a little more time off and still produced far more than did workers in 1950. Over those same 62 years, the average French work-year fell by 684 hours and still workers produce 4.7 times as much in a year.

Of course, this broad prosperity of increased consumption and less labor is much less true for ordinary Americans. According to the Bureau of Labor Statistics, the real hourly wage for nonsupervisory and production workers rose only 6.5 percent between 1972 and 2012—less than 0.16 percent per year.

In a recent column to bolster his claim that means-tested programs have only addressed "the symptoms of poverty, not causes", Nick Kristof notes that "the proportion of Americans living beneath the poverty line, 15 percent, is higher than in the late 1960s in the Johnson administration."

Kristof then goes on to locate the causes of poverty, not in our failure to ensure that wages kept pace with productivity growth over the last several decades, but instead in "a difference in parenting strategies." According to Kristof, the real problem isn't what poverty-expert Sheldon Danziger has described as "the turn to an unequal economy after the 1970s," it's that "working-class families often take a more hands-off attitude to child-raising."

Conservatives used to think Murphy Brown's childrearing was the problem; Kristof now tells us it's really Roseanne and Dan's parenting that we need to be worried about.

In a response, CBPP's Bob Greenstein mostly steers clear of parenting practices, and instead takes on Kristof's disparaging of means-tested programs. Greenstein notes that the official poverty measure doesn't count the Earned Income Tax Credit and in-kind nutritional assistance. Although he doesn't say it directly, his implication seems to be that the "real" poverty rate today is much lower than the official Census number of 15 percent.

It's certainly right to say that millions of children are better off today because of Medicaid, the Earned Income Tax Credit, nutrition assistance, and various other means-tested components of our welfare state. These investments address both the symptoms and the causes of poverty. They also help stabilize the economy during downturns, a function that has broad economic and social benefits. We're a richer nation today as a consequence.

Still, we have to acknowledge that the poverty rate today isn't lower than it was in the late 1960s. Yes, the official poverty rate (15.1 percent in 2011) doesn't count important benefits, which biases the rate upward. But the official measure also relies on an archaic poverty line that hasn't been updated (except for inflation) for four decades and doesn't take into account the way that broad public consensus about basic needs has evolved since then. This biases the rate downward. At best, the differences cancel each other out.

Are you planning to watch President Obama's State of the Union speech tonight? Then play Economics Bingo with @ceprdc — and discuss on Twitter using the hashtag #SOTUBingo.

If the predictions swirling around the media are accurate, then President Obama, as he outlines his agenda and priorities for his second term, will be spending a significant part of his time on the economy. That would mean many CEPR Economics Bingo winners!

To play, click on each topic that he mentions — and scroll down to learn more about the issue from CEPR (make sure you click on the text within each box). Line up topics to win. You can refresh the page for a new card.

Be the first to call out on #SOTUBingo when he hits upon a topic on the Bingo board — and of course, when you win! Take a screenshot and share with @ceprDC.

The Congressional Budget Office (CBO) came out with its new projections for the budget today. There are not many surprises. It projects somewhat slower health care cost growth in recognition of the recent trend in the sector. It also projects continued high unemployment, with the unemployment rate not projected to fall below 6.0 percent until late in the year 2016.

One interesting item is the sharp projected increase in interest costs. In the baseline projections, outlays are projected to rise by 0.1 percentage points of GDP from 22.8 percent in 2012 to 22.9 percent in 2023. However interest costs are projected to rise by 1.9 percentage points, meaning that non-interest spending is projected to fall sharply over this period. (The baseline includes several assumptions that are unrealistic, so it is probably not the best set of projections.)

It is also worth noting that CBO has become very pessimistic about the economy's growth potential and the lower limit on the unemployment rate. It puts potential growth over the decade at just 2.2 percent annually. Part of the explanation is that it expects capital deepening (the increase in the ratio of capital to labor) to make less of a contribution to growth than in prior decades. This is a bit hard to understand since CBO projects that the cost of capital will be low compared to the 1980s and 1990s when capital made a considerably larger contribution to GDP growth.

Source: CBO, Federal Reserve Board, and Bureau of Economic Analysis.

The graph shows CBO's projection for the contribution of capital to growth. At 1.0 percentage point annually, the projected contribution of capital growth in the next decade is lower than in the 1970s, 1980s, and 1990s.

The impact of the aging of the U.S. population on the finances of Social Security has been widely touted by the media and Washington pundits. While these demographics do raise costs for the program, this is hardly an unbearable burden and it certainly is not a surprise. We have known about the baby boom for more than 50 years.

What is newer and was less widely anticipated is the upward redistribution of income that we have seen over the last three decades. This affects the program in two ways. First it has a direct effect in that a larger share of wage income has gone over the taxable maximum (currently just over $113,000). In 1983, the Greenspan commission set the cap at a level where 90 percent of wage income would be subject to the tax, meaning that 10 percent would escape taxations.

Since that date, the upward redistribution of wages has increased the portion of wage income over the cap to 16.8 percent, with just 83.2 percent of wage income subject to the cap. The share going over the wage cap is projected to rise further, reaching 17.5 percent of wage income in a decade. In this way, the upward redistribution of income directly worsens the finances of the program.

However there is also an indirect effect. If wages had kept pace with productivity growth over the last three decades, the typical workers would be paid around 25 percent more than they are now getting. In an environment of growing wages the prospect of increased Social Security taxes may not seem as bleak as in the environment of stagnating wages that we now see. While it is difficult to know how the political situation would differ if wages had kept pace with inflation, it is worth noting that even now workers would prefer higher payroll taxes to cuts in benefits according to a recent poll by the National Academy for Social Insurance.

The following highlights CEPR's latest research, publications, events and much more in January.

CEPR on Haiti Haiti Relief and Reconstruction Watch blogger and CEPR International Research Associate Jake Johnston was in Haiti for the month of January, providing first-hand accounts on many of the issues that the blog has covered since the earthquake devastated the country three years ago.

CEPR marked the January 12th anniversary of the earthquake, which killed over 217,000 people and left 1.5 million homeless with a series of blog posts offering a partial round-up of news, analysis and commentary. CEPR Co-director Mark Weisbrot also released a statement, noting that Haiti continues to struggle despite – and partly because of – failures of the international aid and reconstruction effort. Mark was interviewed by the Real News on Canada’s decision to suspend aid to Haiti, and was cited in this Los Angeles Times article and this piece from Mother Jones. Jake was quoted in this article from the Christian Science Monitor.

CEPR on Unions The Bureau of Labor Statistics released its annual summary of unionization in the U.S., reporting that the union-membership rate of wage and salary workers in 2012 was 11.3 percent. Fifty years ago, the figure was almost 30 percent. CEPR Research Assistant Kris Warner wrote an op-ed for Bloomberg's Echoes blog where he contrasts long-standing declines in the United States with higher and more stable unionization rates in Canada, which has labor law that is much friendlier to unionization. Senior Economist John Schmitt and Research Assistant Janelle Jones wrote this analysis of the overall numbers for the CEPR blog. John also wrote a blog post focusing on the decline of public-sector unions.

In CEPR’s latest issue brief titled State Union Membership, 2012, John, Janelle and CEPR Program Assistant Milla Sanes focus on the union membership numbers by state. In addition to presenting the official BLS estimates for overall union membership in each state, the short report also provide CEPR's own breakdown of state union membership in the private and public sector.

There is little dispute among economists about the sharp rise in inequality over the last three decades. According to the Congressional Budget Office, the top one percent's share of before-tax income roughly doubled between the late 1970s and the present -- from 10 percent to 20 percent. This gain came at the expense of the bottom 80 percent of the income distribution, who have seen little benefit from economic growth over this same period.

Economists generally agree about the facts on rising inequality. There are, however, enormous disagreements on the causes. The prevailing view within the profession attributes the rise in inequality primarily to technological change.

Is Rising Demanding for High-Skilled Workers Creating More Inequality?

The basic story is that computerization and other technological breakthroughs of the last three decades have displaced large numbers of relatively good paying jobs in manufacturing and elsewhere.

This loss of middle class jobs has forced formerly well-paid workers to crowd into occupations further down the wage scale, like retail trade and restaurant work. This has driven down wages for these workers in particular, and the occupations more generally. The result: the middle and bottom of the income distribution have seen relative declines in their wages because the demand for labor has simply not kept pace with the supply.

The most prominent proponent of this view is David Autor, an economics professor at M.I.T. His work purports to show a hollowing out of the middle, with demand increasing for workers in both high paid and low-paid occupations.

But while Autor's work has been widely accepted within the profession and in policy debates, not all of us buy it. In fact, my friends and colleagues Larry Mishel, John Schmitt, and Heidi Shierholz recently wrote a paper that challenges many of Autor's claims. They presented it at the annual economics meetings this month.

Last week, the Bureau of Labor statistics released its estimates for union members in the United States in 2012. CEPR published our own analysis of the numbers, including a breakdown of state union membership in the private and public sectors.

Early analysis has emphasized specific measures such as the implementation of so-called “right-to-work” legislation in Indiana or the attacks on public-sector bargaining in Wisconsin. But, a look at changes across the states shows some geographical patterns that cross state lines.

In the three maps below, the states shaded in red hues lost union members between 2011 and 2012; those in hues of blue saw gains. The darker the hue, the greater the gain or loss as measured in percent terms. Louisiana – in dark blue – saw the greatest overall gain with a 39 percent increase in total union members. Arkansas – in bright red – had the greatest decline, losing 21 percent of its union workers.

Click Maps for Larger Version

The first map shows the percent change in all union members (that is, combining the public and private sector). The deepest reds – indicating the biggest losses – were concentrated in the center of the country, in states such as Wisconsin, Ohio, Indiana, Michigan, and Illinois. The biggest concentration of blue shades – where union membership grew most –was in the west (California, Hawaii, and Nevada) and the south (from New Mexico through Texas and Louisiana all the way to Georgia and South Carolina – though the union base in many of these states is, of course, small).

There is widely held view in Washington policy circles that the economy was golden in the Clinton years. We had strong growth, low unemployment, rising real wages, a soaring stock market and huge budget surpluses. According to this myth, George W. Bush ruined this Eden with his tax cuts for the rich and wars that he didn't pay for. While there are plenty of bad things that can be said about George W. Bush, his tax cuts for the rich and his wars (whether paid for or not), this story of paradise lost badly flunks the reality test.

At the most basic level, the chain of causation is fundamentally wrong. The driving force in this story was the soaring stock market, which was in fact a bubble. Stock prices had grown hugely out of line with the fundamentals of the economy. The ratio of stock prices to trend earnings at the market peak in 2000 was over 30 to 1, more than twice the historic average. It was inevitable that this bubble would burst and in fact the unwinding actually begin when Clinton was still in the White House. The overall market was down more than 10 percent from its peak by January of 2001 and the Nasdaq was down close to 30 percent.

This collapse was the basis for 2001 recession which began less than 2 months after President Bush stepped into the White House. This downturn was the main cultprit in eliminating the cherished Clinton budget surplus, not the tax cuts or the recession. This can be shown in an extension of a graph developed by the Center for Budget and Policy Priorities which shows the sources of the deficit in the Obama presidency.

Note that the budget would have shifted from surpluses to deficits in 2002 even if there had been no tax cuts and no increase in military spending associated with the wars in Afghanistan or Iraq. While neither of these may have been good uses of public money, they did not cause the deficit. The downturn following the collapse of the stock bubble led to the deficits in 2002-2005.

The additional deficits caused by wars and tax cuts were actually a positive for the economy in these years. From an economic standpoint there would have been much better uses of this money, but this spending did help to boost the economy at a point where it desperately needed a lift. While the Fed was not quite at the zero bound in terms of its monetary policy, it had lowered the federal funds rate to 1.0 percent by the summer of 2002.

Most economists would say that there is not much difference between a federal funds rate of 1.0 percent and a rate of zero like we have now, meaning that the Fed would not have been able to provide much additional lift to the economy in 2002-2004 unless it adopted the sort of extraordinary policies that we are seeing today. In this context, it is hard to see an argument against fiscal stimulus, which means deliberately raising the deficit to boost the economy. The deficit would have been much more effective if it had been spent on areas that would provide a direct boost to the economy such as infrastruture or education, but the economy was almost certainly better off as a result of the Bush deficits than if he had tried to maintain a balanced budget as we went into the downturn.

Ultimately the housing bubble grew large enough that it was able to boost the economy nearly back to full employment. By 2006 and 2007 the budget would have again been surplus had it not been for the wars and tax cuts. Of course the collapse of the bubble elminated the prospect of balanced budgets or anything like them for the foreseeable future.

The moral of the story is that the surpluses/small deficits of the last 15 years were the result of bubbles. It is not a good idea to rely on asset bubbles to fuel economic growth or to provide the basis for fiscal responsibility. The result was disastrous when Bush led us down this path. The picture was not much prettier when Clinton went the same route a decade earlier.

The National Academy of Social Insurance (NASI) recently announced the addition of 72 new scholars including CEPR’s Director of Domestic Policy, Nicole Woo. Members of the Academy are nominated in recognition of their substantial and ongoing contributions to the field of Social insurance. They are recognized as leading experts in the fields of Social Security, Medicare, health coverage, unemployment insurance and related social insurance and assistance programs. Nicole’s work, like that of other members, is noteworthy for improving the quality of research, administration or policy-making in one or more of these fields.

As Larry Atkins, the president of NASI said in a press release, “Members are at the heart of NASI. We expect our new members will be engaged – many of them prominently and from a variety of perspectives – on fundamental issues of the role of social insurance programs and their demographic and financial challenges in the next decade. We look forward to recognizing, using, and sustaining their expertise and enthusiasm. It is with great pleasure that we welcome them.”

Much of the concerns about the budget deficit often relates to the fact that we owe a substantial portion of the debt to China. Linking the debt to China with the budget deficit reflects a mistaken understanding of the economy. In a post for the Roosevelt Institute's Econobytes, economist Dean Baker, co-director of the Center for Economic and Policy Research argues there is no direct tie between the size of the budget deficit and our debt to China.

The debt to China is in fact far more dependent on the trade deficit, which should be the main concern for those troubled by this debt.

The basic logic is straightforward, the trade deficit with China is the mechanism through which China obtains the dollars it needs to buy U.S. government bonds or any other dollar denominated asset.

China is in a position to buy large amounts of U.S. government bonds while most other countries are not, because most other countries are not running large trade surpluses. By definition, the fact that China has a trade surplus means that it is selling more goods and services abroad than it is buying.

This means that it is accumulating dollars which can then be used to buy government bonds or other U.S. assets.

There is no special importance to the fact that China’s government is buying government bonds, as opposed to any other asset.

If China holds $2 trillion in U.S. government bonds then the interest on these bonds is paid out to China rather than people in the United States. In that sense it can be seen as a drain on the U.S. economy.

However if China were to sell its $2 trillion in bonds, and instead buy $2 trillion of stock in U.S. companies then the dividends and capital gains from this stock would go to China instead of to people in the United States. This would also be a drain on the U.S. economy.

There is no obvious reason that we should be less concerned about China or any nation or foreign individuals owning shares in U.S. corporations than we are about them owning U.S. government bonds. In both cases there will be an outflow of payments in future years as a result of the foreign ownership of U.S. assets.

If the concern is that a foreign power could disrupt our financial markets by suddenly dumping government bonds, the same concern would arise with a sudden dumping of large amounts of stock of private companies. Both would have a substantial impact on the affected markets and the value of the dollar.

On January 23, the Bureau of Labor Statistics (BLS) released its estimates for union membership in the United States in 2012. This post focuses on the union membership numbers by state. In addition to presenting the BLS estimates for overall union membership in each state, we also provide our own breakdown of state union membership in the private and public sector.

Both the BLS and our own estimates are drawn from the Current Population Survey (CPS).* To give a picture of short-term trends, we present union membership data for both 2011 and 2012.

Table 1 shows total union membership in each of the 50 states and the District of Columbia in 2011 and 2012, based on the BLS data. The last row of the table shows the same information for the nation as a whole. The first three columns present data on the total number of union members. The last three columns display the data as a share of wage and salary workers (that is, excluding the self-employed).

In 2012, California (2.5 million union members), New York (1.8 million), and Illinois (0.8 million) had the most union members. New York (23.2 percent of employees), Alaska (22.4 percent), and Hawaii (21.6 percent) had the highest unionization rates. North Carolina (2.9 percent), Arkansas (3.2 percent), and South Carolina (3.3 percent) had the lowest unionization rates. (Tables 2 and 3 in the longer pdf version of this post show the same data separately for the private and public sectors within each state.)

The Bureau of Labor Statistics unionization estimates for 2012, released this morning, are generally bad news for labor. The overall unionization rate fell 0.5 percentage points. The rate was down 0.3 percentage points in the private sector and 1.1 percentage points in the public sector. (CEPR's advance estimates were very close to the official numbers.)

The big drop in unionization in the public sector is rightly getting a lot of attention. The number of public-sector union members fell by 234,000 last year. This is partly the product of a decline in employment in the sector, which has seen employment fall every year since 2009.

But, the share of public-sector workers in unions also fell, from 37.0 percent in 2011 to 35.9 percent in 2012. This sizeable drop may well reflect the organized attacks against public-sector workers in states such as Wisconsin, where public-sector union membership dropped by about 48,000 workers.

But, it is still too early to tell. As the chart below shows, the unionization rate for public-sector workers has fluctuated in a narrow band since the late 1970s and this year's decline leaves union density in the public sector within that long-term range.